Why is There Essentially No Correlation Between Drilling and Energy Production?
We must be clear: drilling is certainly an essential stage in oil and gas exploration and production. In fact, continued drilling is absolutely essential to continued oil and gas production. For typical wells, production begins to decline soon after pumping begins. The situation is rather like Lewis Carroll’s Red Queen, it takes considerable effort just to stay in the same place, in terms of production. But why, then, is there essentially no apparent energy return on increased drilling in the US historical data in the last half century? The reason is that in a significantly depleted, “mature” petroleum region like the United States, there are severely diminishing returns on increased drilling effort. Why this is the case is really quite simple: petroleum geologists, apparently, know their business. For a nonrenewable resource, a relationship of severely diminishing returns is exactly the relationship expected if geologists are generally able to prioritize the exploitation of both new a
